After Spain, it’s Italy’s turn in the Eurocrisis spotlight. The immediate cause for this spotlight is a two notch downgrade of the Italian sovereign by Moody’s, a rating agency from A3 to Baa2, just two notches above the dreaded junk status. Despite the downgrade, Italy is not Spain and the fact that the downgrade had a rather limited impact on the pricing of Italian bonds issued in its immediate aftermath reflects some of its fundamental strengths.
Nevertheless, expect this to generate a barrage of strongly worded public criticisms from European leaders, but the truth is that they only have themselves to blame. The single biggest factor weighing on the Italian economy at present is the uncertainty about whether or not the Eurocrisis will be resolved. And it is this, rather than Italy’s own domestic situation (which is also complicated), that is the most serious problem.
The German government recently decided to purchase stolen data revealing tax avoiders hiding money in Swiss bank accounts. This is a risky move diplomatically, but, for Germany, the gains from tackling this tax flight appear to outweigh the risks. It is also illustrative of the proliferating efforts by individual governments and the international community to clamp down on tax flight: the loss of tax revenue due to cross border tax evasion or avoidance.
However, the recent spat between Switzerland and Germany is merely the tip of the iceberg; symptomatic of what is one the most serious systemic failures of our time: the lack of intergovernmental cooperation on cross-border financial matters.
2 hours 20 min ago —
I thought those calling 4 a #Lehman like moment in #EU were idiots; I am starting 2 think I was an idiot 4 calling them names - complacency
12 hours 55 min ago —
Irony? “@moorehn: I assume UK will stop criticizing US gun laws after meat-cleaver street beheading? http://t.co/sb5mLVZ1Xj”
14 hours 8 min ago —
I will be defending the #FTT (the concept not necessarily the #EU model) at a panel discussion at #CSFI tomorrow cc @robinhood@oxfamgb
14 hours 28 min ago —
Would you agree that a) wealth should be taxed b) income should be taxed (ideally at the same rate) no matter what it's source?
15 hours 8 min ago —
RT @ottocrat: When I left the office it was a horrible murder; by the time I got home is was “Britain under terror attack!” Get. A. Grip.
After Spain, it’s Italy’s turn in the Eurocrisis spotlight. The immediate cause for this spotlight is a 
Anna Gibson, Research Associate, Re-Define